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Real estate downturn over?

Posted by Scott Van Voorhis April 24, 2012 06:38 AM

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Home sales rose by more than 19 percent in March compared to last spring, The Warren Group reports this morning.

But even more significantly, it was the best March, and the best first quarter as well, in terms of overall home sales in Massachusetts since the spring of 2007, before the Great Recession hit.

So is it time to declare victory and break out the champagne? Are the hard times in real estate finally at an end?

OK, hardly, but better times are certainly on the way with what is turning out to be a sustained rally in home sales.

A total of 3,205 homes sold across the state in March, compared to 2,688 last March. That was the best showing since March 2007, when 3,863 homes sold, according to The Warren Group, publisher of Banker & Tradesman.

However, we are not out of the woods yet. Pay attention to that last number from 2007, that 3,863. We are not even close yet to passing that yet - the sales tally from this March is still roughly 20 percent below where sales were back in March 2007.

Yes, we are headed back, but maybe we are only halfway there.

The Massachusetts Association of Realtors came out with very similar numbers today, reporting a 19.1 percent increase in single-family home sales this March over March 2011.

Meanwhile, prices continue to fall.

The median price for a single-family home fell 3.3 percent, to $260,000.

In Middlesex County, home to the western suburbs and Cambridge, sales rose 18.2 percent in March, but the median price fell nearly 5 percent, to $346,900, according to The Warren Group. Norfolk County, which covers another big stretch of the suburbs south of the city, saw sales rise 15.5 percent, but the median price fall nearly 6 percent, to $325,000.

Boston dominated Suffolk County, by contrast, shook off the doldrums with a 93 percent spike in sales in March and a 16.2 percent price increase, bringing the median to $282,500.

Worcester County, though, saw both sales and prices rise, by 22.6 percent and 2.4 percent respectively, with the median rising to $190,850.

So how do falling prices fit into this relatively rosy picture I am painting here?

OK, declining values, combined with rising unemployment and a host of other grim economic news, did indeed keep buyers on the sidelines over the last few years.

But with the economy picking up and the prospect of a relapse into recession fading for the moment, the lure of a bargain - or at least a chance at a bargain - finally appears to be working its natural appeal.


This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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About boston real estate now
Scott Van Voorhis is a freelance writer who specializes in real estate and business issues.

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